How to retire in Bali: Everything you should know

Many foreigners want to retire in Bali, and that’s not without any reason. Retiring in Bali is an attractive option for many due to its affordable living costs, comfortable climate, and the warm hospitality of the Balinese people. Compared to many developed nations, Bali offers retirees great value for money. There are accommodations to suit various budgets, from modern apartments to luxury villas. For instance, renting a villa can cost anywhere between IDR 5 million ($315) and IDR 20 million ($1,260) per month, depending on the location and amenities.

Daily living expenses, including groceries and utilities, are relatively low. Many retirees choose economical options like scooters or use affordable taxis and ride-sharing services. Healthcare in Bali is accessible and generally less expensive than in Western countries, but health insurance is advisable to access the best facilities. Additionally, the island’s culture, natural beauty, and leisure activities provide an enriching environment for retirees.

Pros and cons of retiring in Bali

Retirement in Bali has its unique pros and cons. Below are the most essential pros and cons of retiring in Bali.

Pros:

• Affordable cost of living: Bali offers a lower cost of living than many developed countries. This lower cost enables retirees to lead a comfortable life without straining their finances.
• Beautiful natural surroundings and climate: The island boasts stunning beaches, a tropical climate, and picturesque landscapes, offering an idyllic setting for retirees to enjoy.
• Rich culture and welcoming locals: Bali’s unique culture and friendly locals create a culturally rich and welcoming environment for retirement in Bali.
• Variety of lifestyle choices: Bali provides diverse retirement options, from tranquil villages to bustling beach towns, catering to different preferences.

Cons:

• Distance from home countries: Bali’s distance from many retirees’ home countries can make travel and family visits more challenging.
• Potential language barriers: While English is widely spoken, navigating daily life may sometimes require knowledge of the local language, which can be a barrier for some retirees.
• Navigating a different healthcare system: The healthcare system in Bali may differ significantly from what retirees are accustomed to in their home countries, requiring adaptation and careful planning.

Requirements to retire in Bali

To retire in Bali with a valid retirement visa, one must meet specific criteria set by the Indonesian government. These are the requirements to retire in Bali:

1. Age requirement: Retiree must be at least 55 years old.
2. Health and life insurance: Provide proof of health and life insurance.
3. Financial stability: Demonstrate financial stability through a monthly pension of around $1,500 or a lump sum sufficient to cover living expenses.
4. Employment of Indonesian citizens: Commit to employing at least two Indonesian citizens, like household assistants or other workers.
5. No employment pledge: Provide a C.V. and a statement agreeing not to seek employment in Bali, confirming the retirement-only purpose of the visa.

How to retire in Bali?

Foreigners who want to know how to retire in Bali should follow these seven steps.

1. Test the waters

Before fully committing to retirement in Bali, staying on the island for at least three months is recommended. This period allows you to acclimate to the local environment, culture, and climate. During this time, engage with the community, try local foods, and explore different areas to determine the best fit for your lifestyle.

2. Find suitable housing

Decide on your preferred area in Bali and start looking for housing. Options range from apartments to luxury villas. Consider hiring a local real estate agent to assist in finding a place that meets your needs and budget. Ensure you have a formal lease agreement, as required for the Bali retirement visa application.

3. Arrange transportation

Public transportation in Bali is limited. If you plan to drive, an international driver’s license is required. You can rent cars or scooters at affordable rates. Alternatively, you can conveniently use taxis or ride-sharing services like Grab and GoJek.

4. Secure health insurance

Having reliable health insurance is crucial for your retirement in Bali. Healthcare costs are generally lower than in Western countries, but insurance ensures access to the best medical facilities and services. Research and choose a plan that fits your health needs and budget.

5. Hire local help

As part of a retirement visa requirement in Bali, you must employ at least two Indonesian citizens. This could be for roles like a house cleaner, gardener, or private chef. The cost is relatively low and also supports the local economy.

6. Financial planning

Ensure you have sufficient funds to support your lifestyle in Bali. You must provide proof of a stable income, with a minimum of $1,500 monthly. This income can be from pensions or other sources, and it’s essential to budget accordingly for your expenses in Bali.

7. Prepare legal documentation

Ensure your passport is valid for at least 18 months. Apply for a retirement visa in Bali, which involves gathering necessary documents and possibly working with an agent to streamline the process. Agents can assist with ensuring your documents are accurate and guide you through the immigration process.

8. Consider property investment

For long-term stays, investing in property can be advantageous. Bali’s real estate market has grown, offering opportunities for property investment. However, be aware of the legalities and market trends before investing.

9. Apply for a retirement visa in Bali

Finally, apply for a retirement visa in Bali, also known as a retirement KITAS. This process involves submitting your application and the required documents, such as proof of income, health insurance, and a lease agreement. Working with a trusted agent can simplify this process, ensuring all requirements to retire in Bali are met for a successful application.

Another option is the Second Home KITAS, which is a visa foreigners can obtain by buying property in Bali for their residence.

Retirement visa in Bali

The retirement visa in Bali, also known as a retirement KITAS (Kartu Izin Tinggal Terbatas), is a specialized type of temporary residency permit designed for retirees. Applicants must be at least 55 years old and meet several financial requirements to qualify. These include having health and life insurance and providing a stable income – either a pension of at least $1,500 per month or a lump sum sufficient to cover living expenses.

The retirement KITAS is initially valid for one year and can be extended for up to five years. After this period, retirees can apply for a KITAP (Kartu Izin Tinggal Tetap), which is a permit for an indefinite stay. Holding a retirement visa in Bali allows individuals to enjoy many benefits, such as leasing property, opening a local bank account, and obtaining a local driver’s license. However, retirees are not permitted to work in Indonesia.

Another option is the Second Home Visa in Bali. To obtain the Second Home Visa, you must show proof of funds of at least IDR 2 billion ($126,000) in an Indonesian bank account or proof of ownership of luxury real estate in Bali with a minimum value of IDR 5 billion ($315,000) under a Hak Pakai land title.

Best places to retire in Bali

There are several places to choose from for your retirement in Bali. These are the seven best places to retire in Bali:

• Sanur: Known for its relaxed and unhurried pace, Sanur appeals to those seeking a peaceful retirement in Bali. It features a 6-kilometer boardwalk, protected beaches ideal for swimming, and a growing gourmet scene, all within an accessible area with a village-like atmosphere​​.
• Seminyak: Ideal for retirees who enjoy socializing and a vibrant lifestyle. Seminyak offers a selection of hip restaurants, clubs, and beach clubs alongside a long beach perfect for various activities​​.
• Nusa Dua: Perfect for golf enthusiasts and those seeking luxury living during their retirement in Bali. Nusa Dua boasts long, white-sand beaches with sheltered inlets, high-end shopping, and proximity to world-class healthcare facilities​​.
• Ubud: Celebrated as Bali’s ‘arts’ district, Ubud suits those interested in culture, art, and a cooler climate. It uniquely blends tropical rainforests, art galleries, and a health-conscious community​​.
• Canggu: A trendy area popular with a younger crowd of expats. Canggu is known for its real estate boom, co-working spaces, and lively scene with cafes, pubs, and clubs​​.
• Kuta: Ideal for those who prefer a dynamic and bustling environment. Kuta is famous for its surf breaks, long sandy beaches, and affordable dining and entertainment options​​.
• Jimbaran: Offers a blend of traditional and modern amenities. Known for its seafood markets and less developed than neighboring areas, Jimbaran provides a tranquil beach environment with a traditional Balinese village feel​​.

Cost of living in Bali

Retirement in Bali offers an attractive cost of living, especially compared to many Western countries. The affordability in Bali allows for a comfortable lifestyle, making it a popular choice for retirees.

1. Housing: Housing costs vary based on location and style. Renting a 2-3 bedroom villa can range from IDR 5 million ($315) and IDR 20 million ($1,260) per month. Prices can be higher in prime areas like Seminyak or Canggu than in remote locations​​​​.
2. Food: Dining in Bali ranges from affordable local eateries to more upscale restaurants. Street food and local warungs offer meals around IDR 27,500 ($1.73) per dish, while specialty restaurants and beach clubs charge around IDR 150,000 ($9.45) per dish or cocktail​​.
3. Transportation: For transportation, options like renting a scooter or car are economical. Public transportation, such as taxis and ride-sharing services like Grab and GoJek, are also affordable and convenient​​​​.
4. Healthcare and insurance: While healthcare in Bali is generally more affordable than in Western countries, having health insurance is advisable for access to the best facilities​​.
5. Sports: Being a member of a sports club, such as the gym, is relatively expensive compared to many Western countries, with an average price of IDR 1.01 million ($63.63) per month.
6. Utilities: Expect to pay around IDR 740,000 ($46.62) per month for essential utilities and IDR 50,000 ($3.15) for a mobile phone plan.

Overall, the cost of living to retire in Bali can be tailored to various budgets, offering retirees the flexibility to choose a lifestyle that suits their financial means.

Do retirees pay taxes in Bali?

Whether retirees pay tax in Bali depends on their tax residency status. This status is based on their stay duration and intention to reside in Indonesia.

A progressive tax rate ranging from 5% to 35% applies for tax residents based on their net income. Non-residents are subject to a flat tax rate of 20% on Indonesian-sourced income. Additionally, all residents, including retirees, must obtain a personal tax number (NPWP) to fulfill their tax obligations.

Foreigners who want to retire in Bali should also consider whether their home country has a tax treaty with Indonesia, which could offer certain exemptions or reduced rates.

Buy property and retire in Bali with Own Property Abroad

Do you want to retire in Bali and buy property? Own Property Abroad can assist you and ensure a seamless and hassle-free property journey. Thanks to our extensive knowledge and local experience in the Indonesian market, we can help with legal requirements, finding suitable properties, negotiating the best deals, conducting due diligence, and obtaining the right visas to retire in Bali.

With our expert team, you won’t have to navigate the complexities of the Indonesian market alone. For further information on how we can assist you, kindly drop your details below or email us at [email protected]. Let’s start working on your property success story today!

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